How AI Makes the Finance Sector More Customer-Oriented

The financial services industry is ready for the digital era. Traditionally slow to change, the industry – covering banking, investment and insurance – has already started its digital transition, from building digital platforms for its products, to offering chatbots to field customer queries. Predictions estimate the Asia-Pacific fintech market will be worth US$72 billion by 2020.

There is a divide, however, between the approach newcomers take – ‘born digital’ disruptors and challengers like Baidu, Tencent and Grab – and that of incumbent organizations. What the disruptors know is how to build a system that is customer-first rather than product-first. While traditional finance organizations have access to plenty of data, from application forms to transactions, the born digital services have access to customer data from different digital touchpoints, creating a full picture of customers’ interests and behavior. This suits the new marketing paradigm of providing a more personalized experience. 

Customers have always wanted to make educated decisions about their money, and information that is timely, relevant, trustworthy and accessible is the key. It is now possible for the financial services sector to support them through better marketing.

Asia Leads the World

The five biggest banks in the world are located in Asia and the banking market in emerging Asia-Pacific countries is the fastest growing in the world. Early adopters include China and India, where mistrust due to counterfeit banknotes hastened the uptake of cashless payment systems. Other countries such as Japan and Malaysia have made digital payments part of government and national bank policy.

Less mature markets like the Philippines, where fewer than 35 percent of people over the age of 15 have a bank account, are also ripe for digital transformation, bypassing traditional financial institutions and opening the market to digital-only lenders, including peer-to-peer services like Funding Societies and CreditEase.

The uptake of digital payment systems gives financial institutions and challenger service platforms unprecedented data about their customers. For finance marketers, the ability to find actionable insights – patterns in the data to determine likely clients and predict their behavior – will place them at an advantage. This is where artificial intelligence (AI) shines; already more than 30 percent of financial institutions in Asia believe AI and chatbots will be a game-changing technology that will shape the industry over the next 12-18 months.

AI Can Help Finance Get Personal

For the finance sector, data sources include both customers’ financial transactions and their online browsing information. Use an AI-powered data science platform to combine historical data, such as transactions, previous campaign results and past user behavior, in a single view to show patterns of customers’ cross-screen behavior. Leveraging extra data from external websites, marketers can also use AI to discover customers’ external interests and intent for precise segmentation, in order target them in a predictive way.

In addition, advanced AI models helps track, unify and analyze cross-screen behavior across multiple devices to identify potential customers. Consider a user who checked out a webinar of an entrepreneur. Later that day he searched for commercial properties to lease. The data would indicate that he could be a prospect for a small business lender. 

Matching campaigns with customer readiness also gives marketers better return on investment. With an intimate knowledge of the purchase cycle, AI can pinpoint where a customer is and deploy the right message at the right time. A customer in the research stage to apply for a mortgage will appreciate a content marketing push, whereas a customer comparing specific insurance products is more likely to interact with a chatbot to confirm details and apply.

The increasing digitization of the financial services sector and the increasing convergence of technology platforms offer marketers a huge data landscape to traverse. AI tools support marketers with predictive intelligence to create a comprehensive understanding of their customers and prospects. Marketers can then target the right people with the right campaign at the right stage in the purchase cycle. Combined, AI functions like this will generate US$2.1 trillion in business value by 2021. Have you taken this golden opportunity yet?

 

* More in-depth insights in our latest white paper ‘Predict Customer Behavior in Financial Services: How Artificial Intelligence and Data Science Enable Better Marketing and Higher ROI’. Download now to find out how AI can help financial institutions analyze data, make precise predictions and offer insights that enable them to create a more effective marketing strategy and campaigns.